The yen weakened from near a 13-year high against the dollar after Finance Minister Shoichi Nakagawa signaled Japan is ready to intervene in the foreign-exchange market for the first time in four years.
The yen also dropped versus the euro after Nakagawa told reporters in Tokyo the country will take "necessary steps if needed" to limit the currency's advance. The dollar fell to an 11-week low against the euro on speculation the U.S. Federal Reserve's near-zero interest rate policy will reduce the appeal of U.S. assets. The pound tumbled to a record low against the euro for a ninth day.
"We're seeing increased jawboning by officials, increasing speculation that intervention is imminent," said Lee Hardman, a London-based currency strategist for Bank of Tokyo-Mitsubishi. "The Bank of Japan may also ease policy, which may slow the pace of yen gains."